Conference Realignment

[RonJohn]

B1G and SEC exerting more of their power. Everyone knows how this is going to end, right? LOL at anyone who thought the SEC and B1G were being altruistic in forming an advisory group to straighten out the NCAA and college sports mess. At the end of the day, conferences are about making money. Powerful companies (see: SEC and B1G) want to maximize making money, and if they can bend and dictate rules to maximize revenue for themselves, they will. It's not a difficult concept to grasp.

I think everything is pointing to a split in the NCAA. My prediction would be a complete split of the top from the NCAA, football, basketball, olypic sports, everything. Probably would end up with more than 40 and less than 80 schools involved. You wouldn't want to take all of FBS, but you need enough to keep basketball and olypic sports operating in the new organization of schools.

 

[stinger78]

Anyone doubt now the intent of the B1G and SECheat? Why would we want to be part of that?

 

[Techster]

Anyone doubt now the intent of the B1G and SECheat? Why would we want to be part of that?

Depends on whether GT wants to play top tier college sports or we're OK with playing sports at a lower level.

Plus and minuses to each, but you have to accept what will come with playing outside of the "Power 2".

 

[orientalnc]

If I understand this correctly, the SEC and B1G are saying they will not be part of the new CFP if they cannot lock out teams they perceive as undeserving. They want the CFP to be the 12 highest ranked teams no matter the conference and those represented conferences will divide up the money. Oh, one more thing. They want to dictate the rankings to be only SEC and B1G teams.

 

[WreckinGT]

You misunderstand what he is saying. The "exit fee" is three years worth of current media payouts. That is currently approximately $130 million. There is no "real cost" to buy back their media rights. I believe he states that in copyright law, once you assign rights to someone else there are very limited legal methods to get those rights back through the legal system. You are looking for what it would cost FSU to leave with their media rights. There is no "real cost" to that. I listed an example of a classic car. If someone owns a 1971 Lamborghini Miura, he might want to sell it or he might not. The highest paid price for a 1971 Miura is about $2 million. You could say that the value is $2 million. There might be a buyer who wants to pay $2 million. However, if the owner does not want to sell the car, he will not accept the $2 million and the hopeful buyer will not get to own the car. The ACC owns the media rights of FSU athletics. FSU wants to buy those media rights back. We can make up any number we want to. Two dollars or one hundred billion dollars. If the ACC isn't willing to accept that price, or FSU isn't willing to pay that price, then it isn't the actual price of the media rights.

There is no "exit fee" to leave the ACC with your media rights. There is no way to calculate such an "exit fee" because it doesn't exist. There is an exit fee to leave the ACC. FSU can pay that price and leave for the 2025 season if they so choose.

There is the issue that the ACC owns FSU's media rights. That has nothing to do with an exit from the ACC. That is not a penalty for leaving the ACC, that was a conscious decision by FSU to assign the media rights to the ACC. What this lawyer is stating is not that the numbers are inaccurate. He says "The total, a staggering $572 million, misleadingly conflates separate contractual elements, and is an obvious attempt to take what is fundamentally a question of intellectual property licensing and supplant it with one having to do with antitrust law." He is stating that FSU is swirling all of the numbers together and calling them something they are not. He says "FSU may have a conceivable beef with the raw exit fee, not the money tied to the GOR (an entirely separate issue tied to licensed intellectual property as opposed to a contract penalty)" Those are totally separate items and have nothing to do with each other.

We DO NOT KNOW that ESPN can unilaterally cancel the entire contract with the ACC. FSU has made that claim, but FSU is also conflating and confusing many other points.

The fanboys say that it costs $572 million to leave the ACC. That is totally inaccurate. It costs $130 million to leave the ACC. That is in the ACC bylaws. This article says "Copyright law doesn’t provide an avenue for licensors to rescind their rights based solely on a change in market conditions or the realization that a deal is a bad one." In other words, courts will not give FSU their rights back just because FSU wants them back. Courts are not going to enforce a value that the ACC must accept for the media rights just because FSU wants to sell those rights to someone else.

Nobody is saying there is an exit fee with your media rights. But unless you believe that the ACC will refuse to sell back media rights then there is going to be some kind of settlement or court ruling on the actual cost of those rights. If the ACC did refuse to sell the media rights back to FSU, that is just going to open up another ugly legal battle. FSU obviously can't go anywhere else without media rights so that effectively makes it impossible for them or any other team in the conference to leave for any reason before 2036. Its locking teams into their conference against their will. I'm not sure they want the legal challenge that is going to happen if they attempted to go that route. Even the Big 12 didn't attempt this with Texas and Oklahoma. Its an obvious losing battle. If the lawyer in that article is suggesting that FSU should file a complaint completely ignoring this reality, then im not sure I can agree with him. Then again he was posting articles bashing FSU and Clemson on Linkedin 6 months ago so who knows what he is really thinking.

 

[gtbb]

Anyone doubt now the intent of the B1G and SECheat? Why would we want to be part of that?

More money? There are reasons to want to join in with the P2. If we don't, it won't be the end of Tech football. But it will be different.

 

[orientalnc]

@WreckinGT

I do not know if my UNC neighbor talked to this lawyer, but they are saying the same thing. He predicted the ACC would be willing to negotiate on the exit fee if FSU lands in the B1G or SEC and the ACC still owns the Noles media rights. But, they are not likely to negotiate on the GOR.

Also, even if ESPN cancels the media contract with the ACC, the conference still owns the media rights of every member.

 

[Techster]

Also, even if ESPN cancels the media contract with the ACC, the conference still owns the media rights of every member.

That's when things will get interesting for the ACC. If the ACC doesn't at least equal the projected revenue of the media deal and cash flow that was projected out to 2036 for each member, I think the ACC will have a GIANT legal mess on their hands. It won't be just FSU in court with the ACC.

There's a legal term for holding a party to a legal agreement that's only beneficial to one side. I forget the legal term, but I think if the ACC can only negotiate a media deal that's far below the "original" deal to 2036, it just may be the entire conference in court with each other and the ACC.

 

[orientalnc]

That's when things will get interesting for the ACC. If the ACC doesn't at least equal the projected revenue of the media deal and cash flow that was projected out to 2036 for each member, I think the ACC will have a GIANT legal mess on their hands. It won't be just FSU in court with the ACC.

There's a legal term for holding a party to a legal agreement that's only beneficial to one side. I forget the legal term, but I think if the ACC can only negotiate a media deal that's far below the "original" deal to 2036, it just may be the entire conference in court with each other and the ACC.

I understand your point. What would likely happen is a protracted legal battle similar to the PAC-12.

 

[WreckinGT]

@WreckinGT

I do not know if my UNC neighbor talked to this lawyer, but they are saying the same thing. He predicted the ACC would be willing to negotiate on the exit fee if FSU lands in the B1G or SEC and the ACC still owns the Noles media rights. But, they are not likely to negotiate on the GOR.

Also, even if ESPN cancels the media contract with the ACC, the conference still owns the media rights of every member.

What does not negotiate the GOR mean in this case? That they won't negotiate down from the projected value (429 million) or they won't even allow FSU to purchase their rights back? If they won't allow FSU to purchase their rights back then negotiating the exit fee is pointless because it's impossible for FSU to leave.

 

[stinger78]

If I understand this correctly, the SEC and B1G are saying they will not be part of the new CFP if they cannot lock out teams they perceive as undeserving. They want the CFP to be the 12 highest ranked teams no matter the conference and those represented conferences will divide up the money. Oh, one more thing. They want to dictate the rankings to be only SEC and B1G teams.

Why is this so difficult to understand? The path to more money is more teams in the playoff. That means fewer for us. Let. Them. Go.

 

[RonJohn]

Nobody is saying there is an exit fee with your media rights. But unless you believe that the ACC will refuse to sell back media rights then there is going to be some kind of settlement or court ruling on the actual cost of those rights. If the ACC did refuse to sell the media rights back to FSU, that is just going to open up another ugly legal battle. FSU obviously can't go anywhere else without media rights so that effectively makes it impossible for them or any other team in the conference to leave for any reason before 2036. Its locking teams into their conference against their will. I'm not sure they want the legal challenge that is going to happen if they attempted to go that route. Even the Big 12 didn't attempt this with Texas and Oklahoma. Its an obvious losing battle. If the lawyer in that article is suggesting that FSU should file a complaint completely ignoring this reality, then im not sure I can agree with him. Then again he was posting articles bashing FSU and Clemson on Linkedin 6 months ago so who knows what he is really thinking.

Here is a quote from an FSU BOT member when the GOR was signed: “I was in concert with President Barron that this was the best thing that could happen... It ensures that we don’t lose any members. Nobody can afford to leave now.”. FSU knew that it would be impossible to leave, understood the repercussions, and thought it was good for them. This is not a quote from the ACC. This is not a quote from a twitter personality. This is not a quote from a fanboy forum. This is a direct 2013 quote from a member of the FSU BOT who approved the GOR.

The lawyer isn't saying that they should file a complaint and ignore the GOR. He is saying that the complaint they filed is messy and is mixing things together. I am not a lawyer, but everything I have seen in court systems leads me to believe that court filings should be logical and on point. You need to make logical points, tie them together, and then tie them to laws that are positive towards your objectives. If FSU wants to fight against the $130 million exit fee as being excessive, then they should complain that the actual "exit fee" is excessive. If they want to try to get out of the GOR, they need to make legal points that would provide them an avenue to get out of the GOR. They have done neither. They have pooled the two together. Are they claiming that the ACC shouldn't own their rights, or are they complaining that the exit fee is too high? From a non-legal fanboy perspective, they are saying it costs too much to get out of the ACC. From a legal argument, they are not making a good one. They need to explain in detail which law pertains to which part of their complaint. If there is a lawsuit about a car wreck, the judge would want to know what happened in the accident, not what the plaintiff had for breakfast before the wreck, and how his wife is a nag. FSU's original complaint is confusing. They discuss a lot of things that aren't pertinent to whether they should pay a reduced "exit fee" or whether they should get their media rights back. They confuse things together instead of making a clear road map about what they are claiming and what laws apply to what sections of their complaint.

 

[orientalnc]

Bob Dylan recently sold his media rights to ALL of his songs and recordings to Sony. In the future, Sony will be collect all the royalties from Amazon and Spotify and Pandora and everyone else for Dylan's work. Bob Dylan gets nothing. If he changes his mind, Sony does not have to negotiate with him. They can simply say NO.

 

[WreckinGT]

Here is a quote from an FSU BOT member when the GOR was signed: “I was in concert with President Barron that this was the best thing that could happen... It ensures that we don’t lose any members. Nobody can afford to leave now.”. FSU knew that it would be impossible to leave, understood the repercussions, and thought it was good for them. This is not a quote from the ACC. This is not a quote from a twitter personality. This is not a quote from a fanboy forum. This is a direct 2013 quote from a member of the FSU BOT who approved the GOR.

The lawyer isn't saying that they should file a complaint and ignore the GOR. He is saying that the complaint they filed is messy and is mixing things together. I am not a lawyer, but everything I have seen in court systems leads me to believe that court filings should be logical and on point. You need to make logical points, tie them together, and then tie them to laws that are positive towards your objectives. If FSU wants to fight against the $130 million exit fee as being excessive, then they should complain that the actual "exit fee" is excessive. If they want to try to get out of the GOR, they need to make legal points that would provide them an avenue to get out of the GOR. They have done neither. They have pooled the two together. Are they claiming that the ACC shouldn't own their rights, or are they complaining that the exit fee is too high? From a non-legal fanboy perspective, they are saying it costs too much to get out of the ACC. From a legal argument, they are not making a good one. They need to explain in detail which law pertains to which part of their complaint. If there is a lawsuit about a car wreck, the judge would want to know what happened in the accident, not what the plaintiff had for breakfast before the wreck, and how his wife is a nag. FSU's original complaint is confusing. They discuss a lot of things that aren't pertinent to whether they should pay a reduced "exit fee" or whether they should get their media rights back. They confuse things together instead of making a clear road map about what they are claiming and what laws apply to what sections of their complaint.

Just curiously, do you think the team at Greenberg Traurig is a bunch of incompetent fanboys?

 

[stinger 1957]

Everyone is focused on the big 2 and the money at that level and I understand that, but I see it different for GT and some of the other schools. They are focused on the money also but a different source of money. Those are the schools that believe they could end up in the Big10, schools that are AAU schools. They are focused on the research money that comes to the AAU schools that are members of the Big 10 conference, that is the really big money according to some comments I've seen over the past year or so. The money through athletics is a drop in the bucket compared to the research dollars, that is what is motivating the GT administration and other AAU schools IMO. The motivation for the Clemsons and FSUs of the CFB world that are not AAU schools is survival, they know where we are headed and are looking for their survival landing spot IMO. Until I see FSU become an AAU school I will not believe their landing spot will be Big 10 no matter what they claim. I believe the U. of FL (present AAU member) will become a Big 10 member before FSU, not saying they are, just believe it would happen before it happens to FSU.
Just my opinion and certainly I could be wrong but I believe we're eventually headed to one mega CFB conference similar to NFL, built around good media mkts. We will probably go through stages of consolidation to get there, how long that takes I do not know, lots of forces can push on that while we're getting there.

 

[WreckinGT]

Bob Dylan recently sold his media rights to ALL of his songs and recordings to Sony. In the future, Sony will be collect all the royalties from Amazon and Spotify and Pandora and everyone else for Dylan's work. Bob Dylan gets nothing. If he changes his mind, Sony does not have to negotiate with him. They can simply say NO.

Well, yeah, but he already got that money. Had he signed an agreement just for Sony to sell his music and they just decided to sell CDs out of a van behind a 7-Eleven making him 50 bucks a week then he probably has legal recourse to end that deal. The ACC has a fiduciary responsibility. They can't just sign the GOR and then twiddle their thumbs ruining the financial future for everyone who signed it. That is a pretty big difference. Did they meet their fiduciary responsibility? I guess someone will decide soon. It somewhat ties into the playoff discussions as well. If the ACC bends over and takes some awful deal, which they almost certainly will, then it just strengthens that case.

 

[RonJohn]

Just curiously, do you think the team at Greenberg Traurig is a bunch of incompetent fanboys?

I think they have a very difficult case to argue, and a client who is being unreasonable. I read one lawyer, maybe it was on here maybe somewhere else, who said that many lawyers won't take on a case they know they can't win. But some lawyers will explain to the client that the case is very unlikely to win and will file the lawsuit and collect money from the client as long as the client understands and is still willing to pay.

My opinion about the entire matter is that FSU is only trying to be as difficult as posible to try to force a low settlement. I doubt many at FSU actually believe they can win in court, especially with the quality (or lack thereof) in their legal filing. (at least the original complaint.) I think they are playing with fire. I think I have stated before that once the venue has been decided, if FSU keeps their desire to announce their departure from the acc effective August of 2023 that the ACC could possibly just accept that. Once again, not a lawyer, but I would think that if FSU has asked for that as a remedy and the ACC files that they accept it, that the judge would just declare it to be true. At that point, FSU would no longer be a voting member of the ACC, and would not get any ACC revenue starting in July 2024. Then they would be out, owe the exit fee, and not have their GOR. Plus they would not have as much leverage to negotiate a settlement. They would be solely depending upon the lawsuit as a remedy. A lawsuit that appears to be pretty weak from a legal standpoint. I don't even understand the request to have the announcement retroactive, because they can't possibly schedule football games for 2024 without being in the ACC at this point. Most of the schedules of all of the other teams are already made. They will have to play their ACC schedule, or they will only have 4 games to play. They will not be in another conference in 2024, because all of the other conferences have already set their schedules also. They won't have time to get an independent TV contract that will pay anything, and even if they do they will only have three games (Memphis, Charleston Southern, and UF) to show on TV. I don't think they will keep that request in the lawsuit once a venue has been decided.

 

[orientalnc]

Well, yeah, but he already got that money. Had he signed an agreement just for Sony to sell his music and they just decided to sell CDs out of a van behind a 7-Eleven making him 50 bucks a week then he probably has legal recourse to end that deal. The ACC has a fiduciary responsibility. They can't just sign the GOR and then twiddle their thumbs ruining the financial future for everyone who signed it. That is a pretty big difference. Did they meet their fiduciary responsibility? I guess someone will decide soon. It somewhat ties into the playoff discussions as well. If the ACC bends over and takes some awful deal, which they almost certainly will, then it just strengthens that case.

That may true, but in this case Sony is till selling Dylan's CDs at the same price as in the past. What's happened is Dylan thinks his CDs are worth as much as Taylor Swift CDs that are selling for $10 more. So he wants all his media rights back and does not want to pay Sony anything.

 

[RonJohn]

Well, yeah, but he already got that money. Had he signed an agreement just for Sony to sell his music and they just decided to sell CDs out of a van behind a 7-Eleven making him 50 bucks a week then he probably has legal recourse to end that deal. The ACC has a fiduciary responsibility. They can't just sign the GOR and then twiddle their thumbs ruining the financial future for everyone who signed it. That is a pretty big difference. Did they meet their fiduciary responsibility? I guess someone will decide soon. It somewhat ties into the playoff discussions as well. If the ACC bends over and takes some awful deal, which they almost certainly will, then it just strengthens that case.

Dylan signed his rights away, period. If Sony decided not to allow the music to ever be used again, he has no recourse.

What fiduciary responsibility are you referring to? FSU knew the details of the contract in 2013, and signed the GOR. FSU knew the details of the ESPN contract in 2016. They knew what the money was. They knew what the length of the contract was. They thought it was in their best interest and signed the GOR with full knowledge. The only thing that has changed is the market conditions. The ACC has not failed to do anything that they should have after the contracts were signed. FSU knew what the ESPN contract said back in 2016 when they signed the GOR, so how can they now claim that the ACC failed their fiduciary responsibility to maximize the earnings in 2016?

 

[Augusta_Jacket]

Just curiously, do you think the team at Greenberg Traurig is a bunch of incompetent fanboys?

The thing is, lawyers always win, even if they lose. FSU will be paying them hefty legal fees regardless of the outcome of the case.